Restoring our Economy

Floor Speech

By:  Adam Schiff
Date: Nov. 16, 2011
Location: Washington, DC

Mr. SCHIFF. Mr. Speaker, in the waning months of the Clinton administration, Jason Seligman, a government economist, produced a memo for the White House that speculated on what the effects would be if the United States paid off its national debt by 2012, as many were predicting at the time.

The memo, which was obtained by NPR under the Freedom of Information Act, was never released publicly, and the events of the intervening years have rendered it nothing more than an historical curiosity, but its mere existence is both a stark reminder of what might have been, and an acknowledgment that the great majority of the current debt was built up during the last administration.

In late 2000 no one could have foreseen the 9/11 attacks or the wars that would follow. These certainly contributed to the red ink. But profligacy, poor strategic choices, and political positioning are the real drivers of our burgeoning budget, which was under $6 trillion at the time of President Clinton leaving office but is now nearly $15 trillion.

Add in a real estate bubble fueled by too easy credit and an economy that was no longer focused on creating and making things here in America, and the challenge facing us comes into even more clear focus.

In one week, the bicameral supercommittee is due to present its plan to Congress to rein in our out-of-control finances and restore the responsible stewardship of our economy that prevailed at the end of the Clinton administration, when government ran surpluses for four straight years. A mere month after the supercommittee presents its plan, just before Christmas, we will either bless its work or face the real prospect of painful across-the-board cuts beginning in 2013.

I have long supported a realistic approach and urged the supercommittee to go big and consider the full range of government spending in making cuts. However, I also know that we cannot put our fiscal house in order solely through spending cuts, and that the government is going to have to find a way to increase the revenue flowing into the Federal Treasury.

While the choices we will confront in the next few weeks will be difficult, they're only the beginning of a process that must result in a new economic paradigm that will guide Congress and the administration in the coming years, when we'll be forced to adjust to a much more competitive global environment even as we work to put the economic downturn of the past 3 years behind us.

As the current wave of pessimism surrounding the work of the supercommittee demonstrates, this will not be an easy task, nor will it be accomplished quickly. If we are to succeed, and success is an absolute imperative, I believe that we'll need a new set of long-term strategies and policies to accomplish five principles.

First, the U.S. is going to have to become a manufacturer again. We should be proud that many of the world's iconic consumer products, like Apple iPhones, for example, were designed and developed here. But much of the benefit to our economy is lost because these products are too often manufactured overseas. American workers are not benefiting from the manufacture of Apple's category-leading smartphone.

We need to return to an economy where American workers are involved in the full life cycle of a product, from concept, through design and testing, and on to manufacture and marketing. To do that, I believe that we need to inject some certainty into our corporate tax structure, as well as create a regulatory structure that protects workers, consumers, and the environment, but not in a way that is arbitrary or capricious.

Second, we need to ensure that small business remains the catalyst for the American economy. Capitalism, by its very nature, is highly competitive, and most new businesses fail. While government cannot change that central truth about a market economy, we can foster a climate that makes it easier to succeed by ensuring access to capital, targeted tax incentives, by creating a supportive infrastructure, and devising a regulatory framework that offers American business the best chance of success.

Third, we're in a global war for talent, and we must reorient our immigration structure to attract the most promising people from around the world. It is no longer a given that a young Indian or Chinese entrepreneur will want to move to the U.S. if given the chance. Combined with the disquieting trend that American universities are not producing enough homegrown talent in science, technology, engineering, and mathematics, we face a daunting challenge. In coming days, I'll be introducing legislation that will make it easier for foreign-born graduates in select STEM fields to stay in this country by starting a new business here and hiring American workers.

Fourth, America cannot compete with the developing world in terms of wages, but a highly skilled work force, buttressed by a revitalized world class infrastructure that reduces the time and expense of getting goods to market and fosters innovation, will keep us competitive. That's why I support investments in infrastructure and education that will lay the groundwork for a newly competitive America while addressing the current unemployment problem acting as a drag on our economy.

Working together on these objectives, we can restore the middle class dream that hard work and perseverance will give the average American the chance to live comfortably. As President Clinton once observed, there's nothing wrong with America that cannot be cured by what is right with America.